Divisions emerge as committee weighs minimum-pay proposal

With just a month before Mayor Ed Murray’s deadline for a recommendation about a potential minimum-wage hike to $15, big differences remain between labor and business.

One business representative on the mayor’s Income Inequality Committee suggested Wednesday that a $15 minimum wage apply only to those companies with annual gross revenues of more than $1 billion, according to several sources present.

Other business representatives prefer a phase-in of five to seven years, while City Councilmember Kshama Sawant has said she’d accept a three-year phase-in but only for small businesses and nonprofits.

Even some advocates of a $15 minimum wage propose that tips and health benefits be counted toward that number, a position opposed by some labor groups.

The ultimate broker might be the mayor himself, who has held one-on-one meetings with the two dozen committee members over the past two weeks and says he’ll meet daily, if needed, in April to reach a consensus agreement.

The committee has three more scheduled meetings before the April 30 deadline.

“I do see a path forward,” Murray said Thursday after a daylong symposium at Seattle University on the effects of a minimum-wage hike sponsored by his committee. “If advocates want to dial down the total compensation, they may have to dial up the total phase-in time. The hard bargaining has begun.”

Some of the deep divisions emerged even before the day got under way, with a conservative state foundation saying that the biggest inequality of the symposium was the preponderance of $15 advocates as speakers and panel-discussion moderators.

Panel moderators included Eric Liu, who has written a book with venture capitalist Nick Hanauer about income inequality. Another was Pramila Jayapal, who has identified raising the minimum wage as an issue particularly affecting women and people of color because local and national statistics suggest that they are overrepresented in minimum-wage jobs.

Max Nelsen, labor-policy analyst for the Freedom Foundation, also questioned advocates’ arguments that giving poor workers a raise will be returned to the local economy in the form of increased spending.

“Advocates claim a higher minimum wage could help the economy, but if that’s true, how high is too high? And why?” Nelsen asked before the symposium.

About 450 people, including union members, representatives of nonprofits and faith communities and advocates for minimum-wage workers, attended the seminar, though the numbers dwindled by late afternoon.

Hanauer, a member of Murray’s task force, used the keynote address to reaffirm his support for a $15 minimum wage. He said business should be “compelled, not persuaded or implored” to pay a living wage.

But he broke with some of the more progressive committee members by adding that the initiative should be phased in over several years and include tips and benefits.

That angered Dave Freiboth, executive secretary of the King County Labor Council, not just for the content, but, he said after the speech, because Hanauer took a policy position at a public forum, something Freiboth said the committee members had agreed not to do.

“For Hanauer to use the keynote address at a symposium sponsored by the committee undermines the process,” Freiboth said, though he acknowledged a certain irony in his complaint.

Freiboth made public complaints about the slow pace of the committee’s deliberations a month ago and questioned other members’ sincerity in reaching the mayor’s $15-an-hour goal.

The symposium also offered a public hearing to two studies on the effects of raising the minimum wage.

The other, and more controversial study, was by University of California, Berkeley, researchers who found that numerous studies on cities and states that have raised the minimum wage haven’t shown any negative impact on employment and only slight increased restaurant prices.

That didn’t reassure Tamara Murphy, chef and owner of the Capitol Hill restaurant Terra Plata, who quoted a San Francisco chef and friend who said that the city was driving out restaurants with its demands on business, including raising the minimum wage above $10 an hour and imposing a health-care benefit requirement.

One of the Berkeley researchers, Michael Reich, interrupted her to insist that the research showed that employment at restaurants in San Francisco remained strong compared to surrounding counties that had not raised the minimum wage.

“Individual businesses will say, ‘I have a razor-thin margin, I’ll go out of business if the costs go up.’ But every business in the market will face the same cost increase,” Reich said. “A small increase in price does not change how much people will spend on restaurants.”

One of the symposium panelists, Martina Phelps, who works full time at McDonald’s, says she can’t afford an apartment. Although she earned an associate degree from a community college last year, she lives with her family in Skyway and commutes two hours every day to work.

“I don’t want an extravagant life with Ferraris or mansions. I would just like to meet the basic needs. I’d like to continue my education. I’d like to be able to afford an apartment closer to work. Full-time workers should not have to struggle paycheck to paycheck just to survive.”